Nasdaq is still at Daily DP Resistance

Hi Everybody,

The Nasdaq (on the Daily time frame) is still at DP resistance, so the big question is whether this resistance level will hold and the Nasdaq decline from here ?

Initial signs of weakness came with yesterday's big down day, so we will be watching the next few days closely to see if this initial sign of weakness continues into the next few days. Ideally we would anticipate a period of sideways movement (on the shorter time frame) as Traders position themselves for the next move.

I have also included a "potential" DP support zone on the chart, but that is a long way below current market levels.

Note: this is not a trade recommendation and all Traders should perform their own Analysis.

Comment:

A day later, I would like to update you on how the "shorter term" Chart unfolded.

As you can see from the chart, the rally on the 1hr chart unfolded as a 3 swing ABC pattern, In Elliott Wave terms, this is a "corrective" pattern.

This corrective pattern helps confirm the previous days initial decline and now suggests that further declines are possible.

Comment:

As the US Markets are rallying strongly at the moment, it is important that any Trader must always be ready to adjust their current outlook. Please see the Chart below:

So I have added the current DP resistance zone to the 1hr NQ Chart I posted earlier, to show the zone that must not be exceed if the current Bearish View is to remain.

I hope this string of analysis has been helpful to see how we can anticipate what markets "may" do, but then (and this is important), keep in mind the Analysis that would invalidate the current outlook.

Traders should never be "Set" on a specific Analysis come what may. The market is always right (not the Trader), so we must let it tell us (not us tell it) where it is going, by its own actions.